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Interim Results 2015

Table of contents

  • Page 1
    Interim Results 2015

  • Page 2
    ...flow statement Notes Independent review report to The Royal Bank of Scotland Group plc Summary risk factors Statement of directors' responsibilities Additional information Share information Financial calendar Exchange rates Forward-looking statements Appendix 1 - Capital and risk management Appendix...

  • Page 3
    ... plc' or the 'company' refers to The Royal Bank of Scotland Group plc, and 'RBS' or the 'Group' refers to RBSG plc and its subsidiaries. Some of the financial information contained in this document, prepared using Group accounting policies, shows the operating performance of RBS on a nonstatutory...

  • Page 4
    ... UK time www.rbs.com/results International - +44 (0) 1452 568 172 UK Free Call - 0800 694 8082 US Toll Free - 1 866 966 8024 Slides This announcement and background slides are available on www.rbs.com/results Financial supplement A financial supplement containing income statement and balance sheet...

  • Page 5
    ...Q2 2015, well in excess of RBS's current stock share of 8.3%. Commercial Banking increased loans and advances by £1.4 billion year-on-year, excluding transfers, while continuing to run down non-strategic books. Notes: (1) (2) (3) (4) (5) Operating profit/(loss) before tax, own credit adjustments...

  • Page 6
    ... generated an adjusted operating profit of £1.4 billion in the quarter, up 17% from Q1 2015, with adjusted return on equity estimated at 16%, up from 12% in Q1 2015 (see appendix 3). Accelerated run-down of the Exit Bank RBS remains ahead of plans to exit a number of businesses through sale or run...

  • Page 7
    ... respect to US mortgage-backed securities, foreign exchange trading and its treatment of UK SME customers and continues to incur conduct related costs, including in relation to payment protection insurance and interest rate hedging products. While addressing these ongoing issues, RBS is continuing...

  • Page 8
    ...of all customer needs and thus improve service. Making RBS simpler to do business with - The time to open a personal current account has been halved to 30 minutes as the bank transforms its systems, becoming simpler and quicker. The Commercial Bank has delivered a 75% reduction in customer paperwork...

  • Page 9
    ... Year end 2015 target 46% 11% Notes: Suitable measures for Private Banking and for Corporate & Institutional Banking are in development. NPS for Ulster Bank Business Banking is measured at Q4. (1) Source: GfK FRS 6 month rolling data. Latest base sizes: NatWest England & Wales (3,444) RBS Scotland...

  • Page 10
    ... £1.1 billion profit (including £0.9 billion reclassified from equity). Following this significant reduction in its voting interest, RBS will no longer control Citizens for accounting purposes and will cease to consolidate it; reducing total assets by approximately £78 billion. RBS's remaining...

  • Page 11
    ... cost savings of £800 million in 2015 are expected to be delivered, notwithstanding the adverse impact of the increased UK bank levy. RBS expects to meet its objective of lending growth in strategic segments, UK PBB and Commercial Banking, in line with or above nominal UK GDP growth. Investments...

  • Page 12
    ... costs we are continuing to work through. We are seeing progress in our UK retail and commercial businesses. More customers are choosing us to help them buy their homes than ever before, while the commercial business grew its loan book by £1.4 billion since 30 June 2014. RBS is closely involved...

  • Page 13
    Summary consolidated income statement for the period ended 30 June 2015 Half year ended 30 June 30 June 2015 2014 £m £m Net interest income Non-interest income Total income Litigation and conduct costs Restructuring costs Other costs Operating expenses Profit before impairment releases/(losses) ...

  • Page 14
    ... 31 March 2015 2.26% 95% (2.1p) (1.7p) (4.1%) £43,879m 11,451 Key metrics and ratios Net interest margin Cost:income ratio (Loss)/earnings per share from continuing operations (4) - basic - adjusted (5) Return on tangible equity (6) Average tangible equity (6) Average number of ordinary shares and...

  • Page 15
    Summary consolidated balance sheet as at 30 June 2015 30 June 2015 £m Cash and balances at central banks Net loans and advances to banks (1,2) Net loans and advances to customers (1,2) Reverse repurchase agreements and stock borrowing Debt securities and equity shares Assets of disposal groups (3) ...

  • Page 16
    ... ratio (2,3) Short-term wholesale funding (2,4) Wholesale funding (2,4) Liquidity portfolio Liquidity coverage ratio (5) Net stable funding ratio (6) Common Equity Tier 1 ratio Risk-weighted assets Leverage ratio (7) Tangible equity (8) Number of ordinary shares and equivalent B shares in issue...

  • Page 17
    ..., compared with a loss of £140 million in Q1 2015 and a profit of £458 million in Q2 2014. Profit from discontinued operations of £674 million reflected the rise in the market value of Citizens shares during the quarter. Tangible net asset value per ordinary and equivalent B share was 380p at 30...

  • Page 18
    ... at 30 June 2015 were down 2% from 31 March 2015 and 3% from 31 December 2014, with good growth in UK personal current and savings accounts more than offset by the reduction in scale of CIB and by the impact of the weakening euro on balances in Ulster Bank. CET1 and leverage ratios improved from 11...

  • Page 19
    ... - Citizens Financial Group Gross yield on interest-earning assets of banking business Cost of interest-bearing liabilities of banking business Interest spread of banking business Benefit from interest free funds Net interest margin (1) RBS - UK Personal & Business Banking - Ulster Bank - Commercial...

  • Page 20
    ... of results Key points H1 2015 compared with H1 2014 Net interest income was stable, with asset growth in UK PBB and Commercial Banking. Segmental • splits are affected by the transfer of a number of portfolios between businesses, including the transfer to Commercial Banking of the UK corporate...

  • Page 21
    ... 626 438 2,127 Key points H1 2015 compared with H1 2014 Non-interest income was down 29%, principally reflecting reduced trading income, in line with CIB's • risk and resource reduction. • Losses of £69 million were recorded on the disposal of available-for-sale securities, compared with gains...

  • Page 22
    ... Key points H1 2015 compared with H1 2014 Operating expenses rose as a result of higher restructuring and litigation and conduct costs. • • Adjusted operating expenses were 14% lower, reflecting the benefits of the bank's cost reduction programme. This included an 8% reduction in staff expenses...

  • Page 23
    ...). Restructuring costs included intangible software write-offs in CIB and Private Banking totalling £606 million, which have no impact on CET1 capital or tangible net asset value. • Total restructuring charges are still expected to total c.£5 billion over the five year period 2015-2019 including...

  • Page 24
    ... Bank loans Loan impairment (releases)/losses RBS excluding RCR RCR Loan impairment (releases)/losses Customer loan impairment (releases)/losses as a % of gross loans and advances (1) RBS RBS excluding RCR RCR 30 June 2015 £m (152) 11 (141) (96) 21 (77) (152) (152) 43 (195) (152) 30 June 2014...

  • Page 25
    ... loans, down £9.5 billion from 31 December 2014, when they represented 6.8% of gross customer loans. The £112 million increase in securities impairments related to a small number of single name exposures, predominantly an exposure in the RBS N.V. liquidity portfolio. Q2 2015 compared with Q1 2015...

  • Page 26
    ... 60,743 Risk asset ratios CET1 Tier 1 Total Capital Tangible equity Expected loss less impairment provisions Prudential valuation adjustment Deferred tax assets Own credit adjustments Pension fund assets Other deductions Total deductions CET1 capital AT1 capital Tier 1 capital Tier 2 capital Total...

  • Page 27
    ... of all Citizens credit and counterparty risk RWAs at 30 June 2015, the CET1 ratio would have been 300 basis points higher. RBS's leverage ratio improved by 30 basis points to 4.6% at 30 June 2015, with leverage exposures down 7% to £875 billion. On 29 July 2015, RBS approved plans for an issue of...

  • Page 28
    ... Operating profit/(loss) Additional information Operating expenses - adjusted (£m) (2) Operating profit/(loss) - adjusted (£m) (2) Return on equity (3) Return on equity - adjusted (2,3) Cost:income ratio Cost:income ratio - adjusted (2) Total assets (£bn) Funded assets (£bn) Risk-weighted assets...

  • Page 29
    ...losses)/releases Operating profit/(loss) Additional information Operating expenses - adjusted (£m) (2) Operating profit/(loss) - adjusted (£m) (2) Return on equity (3) Return on equity - adjusted (2,3) Cost:income ratio Cost:income ratio - adjusted (2) Total assets (£bn) Funded assets (£bn) Risk...

  • Page 30
    ...losses)/releases Operating profit/(loss) Additional information Operating expenses - adjusted (£m) (2) Operating profit/(loss) - adjusted (£m) (2) Return on equity (3) Return on equity - adjusted (2,3) Cost:income ratio Cost:income ratio - adjusted (2) Total assets (£bn) Funded assets (£bn) Risk...

  • Page 31
    ... Operating profit/(loss) Additional information Operating expenses - adjusted (£m) (2) Operating profit/(loss) - adjusted (£m) (2) Return on equity (3) Return on equity - adjusted (2,3) Cost:income ratio Cost:income ratio - adjusted (2) Total assets (£bn) Funded assets (£bn) Risk-weighted assets...

  • Page 32
    ... (losses)/releases Operating profit/(loss) Additional information Operating expenses - adjusted (£m) (2) Operating profit - adjusted (£m) (2) Return on equity (3) Return on equity - adjusted (2,3) Cost:income ratio Cost:income ratio - adjusted (2) Total assets (£bn) Funded assets (£bn) Risk...

  • Page 33
    ... 4. Half year ended 30 June 30 June 2015 2014 £m £m Analysis of income by product Personal advances Personal deposits Mortgages Cards Business banking Other Total income Analysis of impairments by sector Personal advances Mortgages Business banking Cards Total impairment (releases)/losses Loan...

  • Page 34
    UK Personal & Business Banking Key metrics Half year ended 30 June 30 June 2015 2014 Performance ratios Return on equity (1) Return on equity - adjusted (1,2) Net interest margin Cost:income ratio Cost:income ratio - adjusted (2) 23.6% 34.0% 3.59% 66% 52% 30 June 2015 £bn Capital and balance sheet ...

  • Page 35
    ...and subsequent balance growth. Successfully trialled the opening of key branches on the two May bank holidays with mortgage advisers and business managers available to meet UK PBB customers' banking needs. Enhancements to our current account opening process have halved the time to open an account to...

  • Page 36
    ...same period. Gross new mortgage lending in the first half of 2015 was £9.1 billion representing a market share of approximately 9%, above our stock share of 8%. Deposit balances increased £5.0 billion driven by instant access growth in personal savings, current accounts and business. RWAs declined...

  • Page 37
    ... pricing. Business loan balances decreased £0.8 billion, largely reflecting the transfer of £0.4 billion to Commercial Banking in Q2, a decrease in Williams & Glyn (Commercial/Corporate) and asset write offs; underlying balances were broadly stable in the quarter. Business deposit balances...

  • Page 38
    ... costs. Half year ended 30 June 30 June 2015 2014 £m £m Analysis of income by business Corporate Retail Other Total income Analysis of impairments by sector Mortgages Commercial real estate - investment - development Other corporate Other lending Total impairment (releases)/losses Loan impairment...

  • Page 39
    ... equity - adjusted (1,2) Net interest margin Cost:income ratio Cost:income ratio - adjusted (2) 8.0% 8.7% 1.94% 79% 76% 30 June 2015 £bn Capital and balance sheet Loans and advances to customers (gross) Mortgages Commercial real estate - investment - development Other corporate Other lending Total...

  • Page 40
    ... existing mortgage customers including a suite of fixed rate options. The bank has also introduced a dedicated team of mobile mortgage managers and returned to the mortgage broker market. • Ulster Bank continues to support Commercial customers and launched new propositions for businesses operating...

  • Page 41
    ... an improvement in credit metrics and the impact of exchange rate movements, contributing to the improvement in return on equity. £1.5 billion of the RWA reduction related to the tracker mortgage portfolio which now totals £8.1 billion. Q2 2015 compared with Q1 2015 Operating profit increased by...

  • Page 42
    ... Total income Direct expenses - staff costs - other costs Indirect expenses Restructuring costs - direct - indirect Litigation and conduct costs Operating expenses Profit before impairment losses Impairment (losses)/releases Operating profit Operating profit - adjusted (1) Note: (1) 30 June 2015...

  • Page 43
    ... Construction Other Total impairment losses/(releases) Loan impairment charge as % of gross customer loans and advances by sector Commercial real estate Asset and invoice finance Private sector services (education, health, etc) Banks & financial institutions Wholesale and retail trade repairs Hotels...

  • Page 44
    ... Cost:income ratio Cost:income ratio - adjusted (2) 11.6% 12.8% 2.87% 51% 47% 30 June 2015 £bn Capital and balance sheet Loans and advances to customers (gross) - Commercial real estate - Asset and invoice finance - Private sector services (education, health etc) - Banks & financial institutions...

  • Page 45
    ...of operating profit in the half year, followed on 1 May 2015 by the Corporate & Institutional Banking UK coverage business, accounting for £13 million of operating profit from the date of transfer. On 1 August 2014, Commercial Cards for UK Personal & Business Banking related customers, with revenue...

  • Page 46
    ... term funds placed by customers at the end of Q1 2015. RWAs increased £1.4 billion to £66.9 billion, including £2.1 billion from the transferred businesses. • • • • Q2 2015 compared with Q2 2014 Operating profit improved £86 million to £400 million. Adjusted operating profit rose...

  • Page 47
    ... - indirect Litigation and conduct costs Operating expenses (Loss)/profit before impairment losses Impairment releases/(losses) Operating (loss)/profit Operating profit - adjusted (1) Of which: international private banking activities (2) Total income Operating expenses Operating (loss)/profit Notes...

  • Page 48
    ... Performance ratios Return on equity (1) Return on equity - adjusted (1,2) Net interest margin Cost:income ratio Cost:income ratio - adjusted (2) (7.5%) 5.1% 3.23% 113% 86% 30 June 2015 £bn Capital and balance sheet Loans and advances to customers (gross) - Personal - Mortgages - Other Total loans...

  • Page 49
    ... billion of expiring credit facilities. The sale of most of the International Private Banking business to Union Bancaire Privée remains on track for Q4 2015. • On 1 January 2015, the Private Banking RBSI business, accounting for £31 million of operating profit in the half year was transferred...

  • Page 50
    ... portfolio values. Q2 2015 compared with Q2 2014 Operating loss was £78 million compared with a £70 million profit in Q2 2014, partly due to the transfer • of Private Banking RBSI business to Commercial Banking on 1 January 2015; performance was also impacted by higher restructuring costs...

  • Page 51
    ... 136 484 484 1,076 Half year ended 30 June 30 June 2015 2014 £m £m Analysis of income by product Rates Currencies Credit Banking/Other Total CIB (Go-forward) Transfers to other areas (2) CIB Capital Resolution excluding disposal losses Disposal losses CIB Capital Resolution (3) Total income Notes...

  • Page 52
    ... of risk elements in lending. RWAs on an end-point CRR basis. £88 billion includes £9 billion of RWAs related to businesses that will transfer out of CIB, comprising the Western European Large Corporate portfolio (expected to move to Commercial Banking in H2 2015) and UK Transaction Services (to...

  • Page 53
    ...European loan portfolio to Commercial Banking accounting for £4 billion of assets and £5 billion of RWAs at 30 June 2015. The UK Transaction Services business will transfer to Commercial Banking in 2016. H1 2015 compared with H1 2014 â- An operating loss of £2,075 million was reported in H1 2015...

  • Page 54
    .... Adjusted operating loss was £227 million, compared with a profit of £177 million in Q2 2014. Note: (1) The business transfer from CIB to CPB was effective from 1 May 2015. Comparatives were not restated and for the whole period the financials of the UK large corporate business were: total...

  • Page 55
    ...Adjusted expenses fell by 22% reflecting the ongoing drive to reduce costs and simplify the business. Note: (1) The business transfer from CIB to CPB was effective from 1 May 2015. Comparatives were not restated and for the whole period the financials of the UK large corporate business were: total...

  • Page 56
    ... drivers where services span more than one segment. Residual unallocated items relate to volatile corporate items that do not naturally reside within a segment. Key points H1 2015 compared with H1 2014 Central items not allocated represented a charge of £47 million compared with a credit of £91...

  • Page 57
    Citizens Financial Group (£ Sterling) Half year ended 30 June 30 June 2015 2014 £m £m Income statement Net interest income Net fees and commissions Other non-interest income Non-interest income Total income Direct expenses - staff costs - other costs Restructuring costs Operating expenses Profit ...

  • Page 58
    ... coverage (1) Customer deposits (excluding repos) Bank deposits (excluding repos) Loan:deposit ratio (excluding repos) Risk-weighted assets (2) - Credit risk - non-counterparty - counterparty - Operational risk Total risk-weighted assets Spot exchange rate - US$/£ Notes: (1) (2) 31 March 2015 £bn...

  • Page 59
    Citizens Financial Group (US dollar) Half year ended 30 June 30 June 2015 2014 $m $m Income statement Net interest income Net fees and commissions Other non-interest income Non-interest income Total income Direct expenses - staff costs - other costs Restructuring costs Operating expenses Profit ...

  • Page 60
    ...dollar) 30 June 2015 $bn Capital and balance sheet Loans and advances to customers (gross) Loan impairment provisions Net loans and advances to customers Total assets Funded assets Investment securities Risk elements in lending Provision coverage (1) Customer deposits (excluding repos) Bank deposits...

  • Page 61
    ...auto, residential mortgage and student loans partially offset by home equity run-off. • Average customer deposits were up 16% (6% on a US dollar basis), driven by growth in money market, term deposits and checking accounts with interest. Q2 2015 compared with Q1 2015 Operating profit decreased by...

  • Page 62
    RBS Capital Resolution RCR is managed and analysed in four asset management groups - Ulster Bank (RCR Ireland), Real Estate Finance, Corporate and Markets. Real Estate Finance excludes commercial real estate lending in Ulster Bank. Half year ended 30 June 30 June 2015 2014 £m £m Income statement ...

  • Page 63
    ... (2) Risk-weighted assets - Credit risk - non-counterparty - counterparty - Market risk - Operational risk Total risk-weighted assets Total RWA equivalent (3) Gross loans and advances to customers (1) Ulster Bank Real Estate Finance Corporate Markets 11.0 (5.1) 5.9 0.6 16.5 8.4 7.4 69% 31 March 2015...

  • Page 64
    RBS Capital Resolution Funded assets Half year ended 30 June 2015 Ulster Bank Real Estate Finance Corporate Markets Total Quarter ended 30 June 2015 Ulster Bank Real Estate Finance Corporate Markets Total Life to date Ulster Bank Real Estate Finance Corporate Markets Total 4.8 9.5 9.8 4.8 28.9 (0.2)...

  • Page 65
    RBS Capital Resolution Capital deductions Half year ended 30 June 2015 Ulster Bank Real Estate Finance Corporate Markets Total Quarter ended 30 June 2015 Ulster Bank Real Estate Finance Corporate Markets Total Life to date Ulster Bank Real Estate Finance Corporate Markets Total 559 505 477 291 1,832...

  • Page 66
    ... loans of REIL gross loans £bn £bn % % % Year-to-date Impairment (releases)/ Amounts losses (2) written-off £m £m 30 June 2015 (1) By sector: Commercial real estate - investment - development Asset finance Other corporate Total By donating segment and sector Ulster Bank Commercial real estate...

  • Page 67
    ...of gross loans % Credit metrics Provisions as a % of REIL % Provisions as a % of gross loans % Year-to-date Impairment (releases)/ Amounts losses (2) written-off £m £m 31 December 2014 (1) By sector: Commercial real estate - investment - development Asset finance Other corporate Gross loans £bn...

  • Page 68
    RBS Capital Resolution Key points RCR funded assets have fallen by 78% since the initial pool of assets was identified. The commitment â- is to reduce funded assets by 85% by the end of 2015, a year earlier than planned. â- RCR funded assets fell to £8 billion, a reduction of £7 billion, or 44%,...

  • Page 69
    ... Group (CFG), the fair value remeasurement of the loss on transfer to disposal groups, and certain Citizens related activities in Central items and related one-off and other items. Diluted EPS for continuing and discontinued operations for the half year ended 30 June 2014 was 0.1p lower than basic...

  • Page 70
    Condensed consolidated statement of comprehensive income for the period ended 30 June 2015 Half year ended 30 June 30 June 2015 2014 £m £m Profit/(loss) for the period Items that do qualify for reclassification Available-for-sale financial assets Cash flow hedges Currency translation Tax Other ...

  • Page 71
    ...borrowing Loans and advances to customers Debt securities Equity shares Settlement balances Derivatives Intangible assets Property, plant and equipment Deferred tax Prepayments, accrued income and other assets Assets of disposal groups Total assets Liabilities Bank deposits Repurchase agreements and...

  • Page 72
    ... balance sheet Half year ended 30 June 30 June 2015 2014 % % Average yields, spreads and margins of the banking business Gross yield on interest-earning assets of banking business Cost of interest-bearing liabilities of banking business Interest spread of banking business Benefit from interest-free...

  • Page 73
    ... Average balance Interest £m £m Assets Loans and advances to banks Loans and advances to customers Debt securities Interest-earning assets - banking business (1,2,3) - trading business (4) Non-interest earning assets Total assets Memo: funded assets Liabilities Deposits by banks Customer accounts...

  • Page 74
    ...June 2015 Half year ended 30 June 30 June 2015 2014 £m £m Called-up share capital At beginning of period Ordinary shares issued At end of period Paid-in equity At beginning of period Reclassification (1) At end of period Share premium account At beginning of period Ordinary shares issued At end of...

  • Page 75
    ...consolidated statement of changes in equity for the period ended 30 June 2015 Half year ended 30 June 30 June 2015 2014 £m £m Retained earnings At beginning of period (Loss)/profit attributable to ordinary and B shareholders and other equity owners - continuing operations - discontinued operations...

  • Page 76
    Condensed consolidated cash flow statement for the period ended 30 June 2015 Half year ended 30 June 30 June 2015 2014 £m £m Operating activities Operating profit before tax on continuing operations Operating profit before tax on discontinued operations Adjustments for non-cash items Net cash (...

  • Page 77
    ...assets and liabilities from that date have been aggregated and presented as separate lines in accordance with IFRS 5. Citizens was also reclassified as a discontinued operation; comparatives for the periods ended 30 June 2014 have been represented. 2. Citizens Financial Group In March 2015, RBS sold...

  • Page 78
    ... relating to pensions; goodwill; provisions for liabilities; deferred tax; loan impairment provisions and fair value of financial instruments. These critical accounting policies and judgments are described on pages 357 to 359 of the Group's 2014 Annual Report and Accounts. 76 RBS - Interim Results...

  • Page 79
    Notes 4. Analysis of income, expenses and impairment losses Half year ended 30 June 30 June 2015 2014 £m £m Loans and advances to customers Loans and advances to banks Debt securities Interest receivable Customer accounts Deposits by banks Debt securities in issue Subordinated liabilities Internal...

  • Page 80
    ... year ended 30 June 30 June 2015 2014 £m £m Staff costs Premises and equipment Other (1) Administrative expenses Depreciation and amortisation Write down of goodwill Write down of other intangible assets Operating expenses Loan impairment releases/(losses) Securities Impairment releases/(losses...

  • Page 81
    ... industry-wide review conducted in conjunction with the Financial Services Authority (now being dealt with by the Financial Conduct Authority (FCA)), RBS agreed to provide redress to customers in relation to certain interest rate hedging products sold to small and medium-sized businesses classified...

  • Page 82
    ... actuarially determined pension cost rates at 31 December 2014. In May 2014, the triennial funding valuation of The Royal Bank of Scotland Group Pension Fund was agreed which showed that the value of the liabilities exceeded the value of assets by £5.6 billion at 31 March 2013, a ratio of 82%. To...

  • Page 83
    Notes 7. Loan impairment provisions and risk elements in lending Operating profit is stated after net loan impairment releases from continuing operations of £431 million for the half year ended 30 June 2015 (H1 2014 - £169 million losses). The balance sheet loan impairment provisions decreased in ...

  • Page 84
    ... half year ended 30 June 2015 to £17,454 million and the movements thereon were: Half year ended 30 June 2015 RBS excl. RCR RCR £m £m At beginning of period Transfer to disposals groups Currency translation and other adjustments Additions Transfers (1) Transfer to performing book Repayments and...

  • Page 85
    ... by applying the standard UK corporation tax rate of 20.25% (2014 - 21.5%), as analysed below. Half year ended 30 June 30 June 2015 2014 £m £m Profit before tax Expected tax charge Losses and temporary differences in period where no deferred tax asset recognised Foreign profits taxed at other...

  • Page 86
    ...end of a reporting period: £320 million was recognised in the quarter ended 30 June 2014. Half year ended 30 June 30 June 2015 2014 Earnings (Loss)/profit from continuing operations attributable to ordinary and B shareholders (£m) Profit/(loss) from discontinued operations attributable to ordinary...

  • Page 87
    ... 321 Half year ended 30 June 2015 UK Personal & Business Banking Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group RCR (1) Non-statutory basis Reconciling items: Own credit...

  • Page 88
    ...165) Half year ended 30 June 2014 UK Personal & Business Banking Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group RCR (1) Non-statutory basis Reconciling items: Own credit...

  • Page 89
    ... ended 30 June 2015 UK Personal & Business Banking Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group RCR (1) Non-statutory basis Reconciling items: Own credit adjustments...

  • Page 90
    ... 2015 UK Personal & Business Banking Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group RCR (1) Non-statutory basis Reconciling items: Own credit adjustments (2) Strategic...

  • Page 91
    ... in Note 13. Total revenue Half year ended 30 June 2015 Inter External segment £m £m UK Personal & Business Banking Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group...

  • Page 92
    ... Ulster Bank Personal & Business Banking Commercial Banking Private Banking Commercial & Private Banking Corporate & Institutional Banking Central items Citizens Financial Group RCR Non-statutory basis Reconciling items: Own credit adjustments Strategic disposals Citizens discontinued operations RFS...

  • Page 93
    ... 28.4% in March 2015. RBS plans to cede control by the end of 2015 and therefore, in accordance with IFRS 5 'Non-current Assets Held for Sale and Discontinued Operations', Citizens is presented with effect from 31 December 2014 as a discontinued operation, with comparatives re-presented, and as...

  • Page 94
    ...Loans and advances to customers Debt securities and equity shares Derivatives Intangible assets Settlement balances Property, plant and equipment Other assets Discontinued operations and other disposal groups Liabilities of disposal groups Deposits by banks Customer accounts Debt securities in issue...

  • Page 95
    ...912 9,630 4,932 - 30 June 2015 Assets Cash and balances at central banks Loans and advances to banks - reverse repos - other Loans and advances to customers - reverse repos - other Debt securities Equity shares Settlement balances Derivatives Intangible assets Property, plant and equipment Deferred...

  • Page 96
    ...4,537 Amortised Finance cost leases £m £m 31 December 2014 Assets Cash and balances at central banks Loans and advances to banks - reverse repos - other Loans and advances to customers - reverse repos - other Debt securities Equity shares Settlement balances Derivatives Intangible assets Property...

  • Page 97
    ... product and deal specific 998 326 716 639 1,681 Valuation reserves 2,679 31 December 2014 £m 1,414 398 718 657 1,773 3,187 Own credit The cumulative own credit adjustment (OCA) recorded on held-for-trading (HFT) and designated as at fair value through profit or loss (DFV) debt securities in issue...

  • Page 98
    ... measured at fair value are included in the 2014 Annual Report and Accounts. There have been no material changes to valuation or levelling approaches in the half year ended 30 June 2015. The tables below show financial instruments carried at fair value on the balance sheet by valuation hierarchy...

  • Page 99
    ...assets), exchange rates, interest rates and other financial variables. Volatility: A measure of the tendency of a price to change with time. RBS does not have any material liabilities measured at fair value that are issued with an inseparable third party credit enhancement. 97 RBS - Interim Results...

  • Page 100
    ...152 million (year ended 31 December 2014 - £205 million) were recorded in other operating income and interest income as appropriate in continuing operations. There were no losses in discontinued operations. Consolidated statement of comprehensive income. Fair value through profit or loss comprises...

  • Page 101
    ... at amortised cost on the balance sheet. 30 June 2015 Carrying value Fair value £bn £bn Financial assets Loans and advances to banks Loans and advances to customers Debt securities Financial liabilities Deposits by banks Customer accounts Debt securities in issue Subordinated liabilities 7.4 81...

  • Page 102
    ...of £1.2 billion recognised during the six months ended 30 June 2015, included anticipated costs following investigations into the foreign exchange market (£334 million), provisions in respect of mortgage-backed-securities related litigation (£506 million), provisions relating to packaged accounts...

  • Page 103
    ... this matter is now closed. Shareholder litigation (UK) Between March and July 2013, claims were issued in the High Court of Justice of England and Wales by sets of current and former shareholders, against RBS (and in one of those claims, also against certain former individual officers and directors...

  • Page 104
    ... statements and/or omissions regarding the underwriting standards pursuant to which the mortgage loans underlying the securities were issued. RBS companies remain as defendants in more than 25 lawsuits brought by or on behalf of purchasers of MBS, including the purported class action identified...

  • Page 105
    ... Southwest Corporate Federal Credit Union, and Members United Corporate Federal Credit Union). The original principal balance of the MBS at issue in the NCUA cases is US$3.56 billion. Other remaining MBS lawsuits against RBS companies include, among others, cases filed by the Federal Home Loan Banks...

  • Page 106
    ... claims under the Commodity Exchange Act for price manipulation. Details of LIBOR investigations and their outcomes affecting RBS are set out under 'Investigations and reviews' on page 108. ISDAFIX antitrust litigation Beginning in September 2014, RBS plc and a number of other financial institutions...

  • Page 107
    ...existing provisions. Certain members of the Group are also defendants in additional foreign-exchange related class action complaints, including several complaints filed in the United States District Court for the Southern District of New York on behalf of investors that transacted in exchange-traded...

  • Page 108
    ... defendants' motion to dismiss this matter and, as a result, discovery is ongoing. CPDO Litigation CPDO claims have been served on RBS N.V. in England, the Netherlands and Australia, and on RBS in England, relating to the sale of a type of structured financial product known as a constant proportion...

  • Page 109
    ...v. HSBC Holdings PLC On 10 November 2014, RBS N.V. and certain other financial institutions (HSBC, Barclays, Standard Chartered, Credit Suisse, and Bank Saderat) were named as defendants in a complaint filed by a number of United States nationals (or their estates, survivors, or heirs), most of whom...

  • Page 110
    ... respectively. This matter is now concluded. In July 2014, RBS entered into an Enforceable Undertaking with the Australian Securities and Investments Commission (ASIC) in relation to potential misconduct involving the Australian Bank Bill Swap Rate. RBS undertakes in the Enforceable Undertaking to...

  • Page 111
    ... and reviews (continued) RBS is co-operating with investigations and new and ongoing requests for information by various other governmental and regulatory authorities, including in the UK, US and Asia, into its submissions, communications and procedures relating to a number of trading rates...

  • Page 112
    ... in scope customers. RBS and KPMG are now focussing on customer responses to review outcomes, securing acceptance of offers and assessing ancillary issues such as consequential loss claims. The review and redress exercise was closed to new entrants on 31 March 2015. The Central Bank of Ireland also...

  • Page 113
    ... between November 2014 and January 2015 with a further communication exercise to the remaining cohorts due to be completed during the second half of 2015. RBS provisions in relation to investment advice total £150 million to date for these matters including for the six months ended 30 June 2015 (of...

  • Page 114
    ... in the Tomlinson Report. The Skilled Person's review is focused on RBS' UK small and medium sized business customers with credit exposures of up to £20 million whose relationship was managed within RBS' Global Restructuring Group or within similar units within RBS' Corporate Banking Division that...

  • Page 115
    ... has been implementing a policy statement agreed with the FCA for the handling of complaints about the mis-selling of Payment Protection Insurance (PPI). RBS has made provisions totalling £3.8 billion to date for this matter, including £0.1 billion in the six months ending 30 June 2015, of which...

  • Page 116
    ... in the UK banking sector. On 24 July 2015 HM Treasury announced that it had asked the CMA to delay finalising its advice until later in the year. At this stage the outcome of the review cannot be predicted. As a result there is a risk that the CMA might recommend changes to the current Williams...

  • Page 117
    ...and corporate banking and potentially into asset management (the latter to launch late 2015 if undertaken). The terms of reference for the investment and corporate banking market study were published on 22 May 2015. The FCA is intending to publish an interim report towards the end of 2015/early 2016...

  • Page 118
    ...and securities industry, focusing on the information underwriters obtained from the independent firms hired to perform due diligence on mortgages. RBS completed its production of documents requested by the New York State Attorney General in 2008, principally producing documents related to loans that...

  • Page 119
    ... admitted nor denied the regulators' findings that they had engaged in deceptive marketing and implementation of the bank's overdraft protection programme, checking rewards programmes, and stop-payment process for preauthorised recurring electronic fund transfers. In connection with the Consent...

  • Page 120
    ... by Citizens arising from other consumer products and related practices and policies, and they could face potential civil litigation. Governance and risk management consent order In July 2011, RBS agreed with the Board of Governors of the Federal Reserve System, the New York State Banking Department...

  • Page 121
    ... a settlement with the Board of Governors of the Federal Reserve System (Fed), the New York State Department of Financial Services (DFS), and the Office of Foreign Assets Control (OFAC) with respect to RBS plc's historical compliance with US economic sanction regulations outside the US. As part...

  • Page 122
    ... In the ordinary course of business, the Group may from time to time access market-wide facilities provided by the Bank of England. The Group's other transactions with the UK Government include the payment of taxes, principally UK corporation tax and value added tax; national insurance contributions...

  • Page 123
    ... The Royal Bank of Scotland Group Pension Fund with the cost of administration services incurred by it. The amounts involved are not material to the Group. Full details of the Group's related party transactions for the year ended 31 December 2014 are included in the 2014 Annual Report and Accounts...

  • Page 124
    ... £1.1 billion profit (including £0.9 billion reclassified from equity). Following this significant reduction in its voting interest, RBS will no longer control Citizens for accounting purposes and will cease to consolidate it; reducing total assets by approximately £78 billion. RBS's remaining...

  • Page 125
    ... financial statements. This report is made solely to the Company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board. Our work...

  • Page 126
    Independent review report to The Royal Bank of Scotland Group plc Conclusion Based on our review, nothing has come to our attention that causes us to believe that the condensed consolidated financial statements in the half-yearly financial report for the six months ended 30 June 2015 are not ...

  • Page 127
    ... includes the implementation of its new divisional and functional structure (the "2013/2014 Strategic Plan") as well as a major investment programme to upgrade and rationalise the Group's information technology ("IT") and operational infrastructure (the "IT and Operational Investment Plan"), further...

  • Page 128
    ...'s Transformation Plan, and in particular of the ring-fence and restructuring of the Group's CIB business, as well as increased legal and regulatory supervision, including the implementation of the new responsibility regime introduced under the Financial Services (Banking Reform) Act 2013 in the UK...

  • Page 129
    ..., including actions in relation to any securities issued, new or existing contractual arrangements and transfers of part or all of the Group's businesses. The Group is highly dependent on its IT systems, which are currently subject to a significant investment and rationalisation programme. The...

  • Page 130
    ... write-downs or impairment charges. Changes in interest rates, foreign exchange rates, oil and other commodity prices also impact the value of the Group's investment and trading portfolios and may have a material adverse effect on the Group's financial performance and business operations. The value...

  • Page 131
    ... risks and uncertainties for the remaining six months of the year); and the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein). • By order of the Board Philip Hampton Chairman 29 July 2015...

  • Page 132
    ... Number of equivalent B shares in issue Total number of ordinary and equivalent B shares in issue 351.5p 6,470m 5,100m 11,570m 31 March 2015 340.0p 6,414m 5,100m 11,514m 31 December 2014 394.4p 6,366m 5,100m 11,466m Financial calendar 2015 third quarter interim management statement Exchange rates...

  • Page 133
    ...looking statements relating, but not limited to: The Royal Bank of Scotland Group plc's (RBS) transformation plan (which includes RBS's 2013/2014 strategic plan relating to the implementation of its new divisional and functional structure and the continuation of its balance sheet reduction programme...

  • Page 134

  • Page 135
    Appendix 1 Capital and risk management RBS - Interim Results 2015

  • Page 136
    ... private banking, on a line-by-line basis. A summary of this presentation is set out in Appendix 2. The disclosures in this appendix supplement disclosures in Analysis of results - Balance sheet related key metrics and ratios; Impairment losses; Capital and leverage ratios. An overview by risk type...

  • Page 137
    ... from 2014 year end. The loan:deposit ratio fell to 92% at 30 June 2015, primarily reflecting asset reductions and a stable deposit base. Based on its current assessment of the Financial Stability Board's proposals, RBS may issue £3-£5 billion of qualifying debt per annum between 2015 and 2019 to...

  • Page 138
    ... class limits were implemented following the new CIB strategy. The growth in UK PBB gross mortgage lending was within credit risk appetite and against a backdrop of sustained house price growth in 2015 that has outstripped earnings growth. Economic fundamentals continue to look strong, helping...

  • Page 139
    ...and operational-related matters: RBS was the subject of investigations and review by a number of regulators, some of which resulted in fines and public censure. The failure of IT systems in June 2015 also impacted customers, with reputational damage to the bank. RBS further reduced its business risk...

  • Page 140
    ... uphold customer, investor and rating agency confidence in the organisation, thereby supporting its business franchises and funding capacity. For a description of the capital management framework, governance and basis of preparation refer to Capital management in the 2014 Annual Report and Accounts...

  • Page 141
    ... a systemic capital buffer and a countercyclical buffer when establishing the minimum leverage ratio for banks. There will also be disclosures and related measurement bases for exposures. Recovery & resolution planning The Financial Stability Board is continuing impact studies on Total Loss...

  • Page 142
    ... and risk management Capital resources End-point CRR basis (1) 30 June 31 March 31 December 2015 2015 2014 £m £m £m Shareholders' equity (excluding non-controlling interests) Shareholders' equity Preference shares - equity Other equity instruments Regulatory adjustments and deductions Own credit...

  • Page 143
    ... movement in end-point CRR CET1 and Tier 2 capital for the half year ended 30 June 2015. CET1 £m At 1 January 2015 Loss for the year net of movements in fair value of own credit Share capital and reserve movements in respect of employee share schemes Ordinary shares issued Foreign exchange reserve...

  • Page 144
    ... credit risk, internal model method (IMM) for counterparty credit risk, and value-at-risk and related models for market risk. These principally relate to CIB (£71.8 billion) and Commercial Banking (£50.5 billion). *Not within the scope of Deloitte LLP's review report 9 RBS - Interim Results 2015

  • Page 145
    ...business run-off as it implemented • the new strategy. These reductions included: â-‹ regional loan portfolio disposals and run-offs (£6.8 billion), including US corporate loan portfolio sales to Mizuho (£3.2 billion); â-‹ US asset-backed product exit (£2.3 billion); â-‹ other trading portfolio...

  • Page 146
    ... Natural resources - Oil and gas - Mining and metals - Other Transport - Shipping - Other Manufacturing Retail and leisure Services TMT (4) Total corporates Personal Mortgages - UK - Ireland - Other Western Europe - US - RoW Total mortgages Other personal Total personal Other items Total 47,477 16...

  • Page 147
    ... Natural resources - Oil and gas - Mining and metals - Other Transport - Shipping - Other Manufacturing Retail and leisure Services TMT (4) Total corporates Personal Mortgages - UK - Ireland - Other Western Europe - US - RoW Total mortgages Other personal Total personal Other items Total Notes...

  • Page 148
    ... funding risk in the 2014 Annual Report and Accounts. Liquidity and related metrics* The table below sets out the key liquidity and related metrics monitored by RBS. 30 June 2015 RBS RBS excluding CFG Liquidity portfolio Stressed outflow coverage (SCR) (1) LCR (2) NSFR (3) Loan:deposit ratio Notes...

  • Page 149
    ...the RBS's five licensed deposit-taking UK banks: The Royal Bank of Scotland plc, National Westminster Bank Plc, Ulster Bank Limited, Coutts & Company and Adam & Company. In addition, certain of RBS's significant operating subsidiaries - RBS N.V., Citizens Financial Group Inc. and Ulster Bank Ireland...

  • Page 150
    ...term balances. The table below shows RBS's principal funding sources excluding repurchase agreements (repos). Short-term less than 1 year £m Deposits by banks derivative cash collateral other deposits Debt securities in issue commercial paper certificates of deposit medium-term notes covered bonds...

  • Page 151
    ... of Ireland's Deposit Guarantee Scheme, £6 billion (2014 - £7 billion). FSCS deposit protection will decrease from the current limit of £85,000 to £75,000 with effect from 1 January 2016. RBS is currently subject to the UK bank levy on its consolidated liabilities and equity after taking account...

  • Page 152
    ... the failure of a customer or counterparty to meet its obligation to settle outstanding amounts. For a description of the bank's credit risk framework, governance, policies and methodologies refer to Capital and risk management - Credit risk in the 2014 Annual Report and Accounts. Loans and related...

  • Page 153
    ... to £62.0 billion, reflecting growth in the retail and wholesale portfolio. Impairments and REIL were broadly unchanged. RCR saw a significant reduction in gross customer loans - £6.5 billion in commercial real estate, £3.3 billion in other corporate and £1.1 billion in asset finance - as the...

  • Page 154
    ... and risk management Loans and related credit metrics: Risk elements in lending UK PBB £m At 1 January 2015 Currency translation and other adjustments Additions Transfers (1) Transfers to performing book Repayments and disposals Amounts written-off At 30 June 2015 Note: (1) Ulster Commercial Bank...

  • Page 155
    ... 1 Capital and risk management Loans and related credit metrics: Loans, REIL, provisions and impairments The tables below show gross loans and advances to banks and customers (excluding reverse repos) and related credit metrics by sector and geography (by location of lending office). Credit metrics...

  • Page 156
    ...construction - other Total US - residential mortgages - residential mortgages - personal lending - property - construction - other Total RoW - residential mortgages - personal lending - property - construction - other Total Customers Banks Note: (1) Includes instalment credit. Gross loans £m 9,079...

  • Page 157
    ...principally relating to asset-backed securities (ABS). Central and local government UK US Other £m £m £m 4,352 7,021 4,932 16,305 16,305 16,305 Of which US agencies Short positions (HFT) Available-for-sale Gross unrealised gains Gross unrealised losses 31 December 2014 Held-for-trading Designated...

  • Page 158
    ... not result in a net presentation on the balance sheet under IFRS. Notional (1) £bn Interest rate (2) Exchange rate Credit Equity and commodity Counterparty mark-to-market netting Cash collateral Securities collateral Net exposure Net exposure by sector Banks Other financial institutions Corporate...

  • Page 159
    ... the first half of 2015 due to an upward shift in yields, based on the expectation of interest rate rises in the US and UK. Eurozone yields also increased following favourable economic outlook. â-‹ Foreign exchange contracts: Fair value decreases from targeted tear-ups and risk reductions have more...

  • Page 160
    ... Key loan portfolios* The internal measure used for credit risk management is credit risk assets (CRA) and consists of lending, derivatives after the effect of enforceable netting arrangements and contingent obligations. The table below summarises CRA by sector and geographic region. Wholesale Banks...

  • Page 161
    ... Ireland; RoW: Rest of World. Key points Overall gross CRE lending fell in the first half of 2015 mostly in RCR (£6.5 billion) due to asset sales, • repayments, and write-offs. • The RCR portfolio contains legacy CIB, Commercial Bank and Ulster Bank assets and now represents 17% of the total...

  • Page 162
    ... for non-performing assets. • Interest payable by customers on performing loans secured by investment property was covered 1.8x (2014 - 1. 6x) and 3.1x (2014 - 2.9x) within RCR and rest of RBS, respectively. *Not within the scope of Deloitte LLP's review report 27 RBS - Interim Results 2015

  • Page 163
    ... on RBS's sector concentration framework. Western Europe UK (excl. UK) £m £m 285 312 147 1 1 746 Including committed undrawn exposures Of which: exploration and production 31 December 2014 Producers (incl. integrated oil companies) Oilfield service providers Other wholesale and trading activities...

  • Page 164
    ... funding operating needs and capital expenditures - and are available as long as counterparties comply with the terms of the credit agreement. Contingent obligations relate to guarantees, letters of credit and suretyships provided to customers. RBS had no high-yield bond or loan underwriting...

  • Page 165
    ... Key loan portfolios* Shipping RBS's exposure to the shipping sector is as follows: 30 June 2015 £m 6,338 1,463 828 8,629 31 December 2014 £m 6,700 2,855 803 10,358 By segment CIB RCR Other Key points Of the total exposure to shipping, £6.6 billion (2014 - £7.9 billion) related to asset-backed...

  • Page 166
    ... fixed rate Mixed (capital and interest only) Buy-to-let Forbearance Forbearance arrears status - Current - 1-3 months in arrears - >3 months in arrears Other lending Total lending Mortgage LTV ratios - Total portfolio - New business - Performing - Non-performing Mortgage REIL Note: (1) Ulster Bank...

  • Page 167
    ... Halifax House Price Index at March 2015, the portfolio average indexed LTV by volume • was 50.4% (2014 - 50.4%) and 57.4% by weighted value of debt outstanding (2014 - 57.3%). Fixed interest rate products of varying time durations accounted for approximately 60% of the • mortgage portfolio with...

  • Page 168
    ...H1 2014. Reducing defaulted balances have reduced loss expectations driving collective and latent releases. CFG The mortgage portfolio at 30 June 2015 consisted of £8 billion of residential mortgages (1% in second • lien position) and £12.5 billion of home equity loans and lines of credit (HELOC...

  • Page 169
    ... risk types less the total portfolio VaR. Key points During H1 2015, trading book exposure continued to decline. The markets exhibited higher volatility and reduced liquidity, resulting from a number of • macroeconomic factors, including ongoing political and economic uncertainty in Europe...

  • Page 170
    ... in inflation basis risk in the rates business. Standardised charges were 37% or £170 million lower than at the 2014 year end, primarily driven by reduced securitisation exposures in the trading book reflecting the continuation of the US ABP exit, UK ABP risk reduction and the continuation...

  • Page 171
    ...earnings arising from banking activities. This excludes positions in financial instruments which are classified as held-for-trading. The methodology relating to interest rate risk is detailed in Capital and risk management - Market risk - Non-traded market risk in the 2014 Annual Report and Accounts...

  • Page 172
    ... of 100 basis points to all interest rates. The main drivers of earnings sensitivity relate to interest rate pass-through assumptions on customer products, reinvestment rate assumptions for maturing product and equity structural hedges and mismatches in the re-pricing dates of loans and deposits. In...

  • Page 173
    ... Capital and risk management Non-trading portfolios (continued) Product hedging* Product structural hedges are used to reduce the volatility on earnings related to specific products, primarily customer deposits. The balances are primarily hedged with medium-term interest rate swaps, so that reported...

  • Page 174
    ... of the CET1 capital ratio to exchange rates is monitored monthly and reported to the ALCo at least quarterly. Foreign exchange exposures arising from customer transactions are sold down by businesses on a regular basis in line with RBS policy. Net assets of overseas operations excluding NCI...

  • Page 175
    ... risk. Refer to Capital and risk management - Credit risk in the 2014 Annual Report and Accounts for other types of concentration risk such as product, sector or singlename concentration and Country risk for governance, monitoring, management and definitions. Key points* The comments below relate...

  • Page 176
    ...UK-centred strategy. Russia - net balance sheet exposure decreased by £0.2 billion to £1.6 billion which included £0.9 • billion of corporate lending and £0.7 billion of bank lending. Around one-third of the bank lending risk was transferred to third-party investors through credit-linked notes...

  • Page 177
    ... the balance sheet exposure exceeded £1 billion and which had ratings of A+ or below from Standard and Poor's, Moody's or Fitch at 30 June 2015, as well as selected eurozone countries. The exposures are stated before taking into account risk mitigants, such as guarantees, insurance or collateral...

  • Page 178
    ... Eurozone Ireland Spain Italy Portugal Greece Cyprus Eurozone periphery Germany France Netherlands Belgium Luxembourg Other Total eurozone Japan China India Russia Central Sovereign banks £m £m 239 251 112 111 8 721 587 15 602 Net balance sheet exposure Other Other banks FI Corporate Personal...

  • Page 179
    Appendix 2 Income statement reconciliations and balance sheet pre and post disposal groups RBS - Interim Results 2015

  • Page 180
    ... costs Litigation and conduct costs Write down of goodwill and other intangible assets Operating expenses Profit/(loss) before impairment releases Impairment releases Operating profit Own credit adjustments (3) Strategic disposals Citizens discontinued operations Profit before tax Tax charge Profit...

  • Page 181
    ... Litigation and conduct costs Write down of goodwill and other intangible assets Operating expenses Profit before impairment losses Impairment losses Operating profit Own credit adjustments (3) Gain on redemption of own debt Write down of goodwill Strategic disposals Citizens discontinued operations...

  • Page 182
    ...from trading activities Other operating income Non-interest income Total income Staff costs Premises and equipment Other administrative expenses Depreciation and amortisation Restructuring costs Litigation and conduct costs Write down of goodwill and other intangible assets Operating expenses Profit...

  • Page 183
    ... Staff costs Premises and equipment Other administrative expenses Depreciation and amortisation Restructuring costs Litigation and conduct costs Operating expenses Profit/(loss) before impairment releases Impairment releases Operating profit Own credit adjustments (3) Strategic disposals Citizens...

  • Page 184
    ...from trading activities Other operating income Non-interest income Total income Staff costs Premises and equipment Other administrative expenses Depreciation and amortisation Restructuring costs Litigation and conduct costs Write down of goodwill and other intangible assets Operating expenses Profit...

  • Page 185
    ...borrowing Loans and advances to customers Debt securities Equity shares Settlement balances Derivatives Intangible assets Property, plant and equipment Deferred tax Prepayments, accrued income and other assets Assets of disposal groups Total assets Liabilities Bank deposits Repurchase agreements and...

  • Page 186
    ... to banks Bank loan impairment provisions Net loans and advances to banks (3) Total loan impairment provisions Customer REIL Bank REIL REIL Gross unrealised gains on debt securities Gross unrealised losses on debt securities For the notes to this table refer to page 6. 7 RBS - Interim Results 2015

  • Page 187
    Appendix 3 Go-forward Bank profile RBS - Interim Results 2015

  • Page 188
    ... 2015 Total income Operating expenses - adjusted (6) Impairment (losses)/releases Operating profit/(loss) - adjusted (6) Funded assets Net loans and advances to customers Customer deposits Risk-weighted assets (7) Return on equity - adjusted (6,8,9) Quarter ended 31 March 2015 Total income Operating...

  • Page 189
    ... 2015 Total income Operating expenses - adjusted (6) Impairment (losses)/releases Operating profit/(loss) - adjusted (6) Funded assets Net loans and advances to customers Customer deposits Risk-weighted assets (7) Return on equity - adjusted (6,8,9) CIB International UK Ulster Commercial Private...

  • Page 190
    ...3% Total Exit Bank £bn 6.0 Total RBS £bn 18.2 Year ended and as at 31 December 2014 Total income Operating expenses - adjusted (6) Impairment (losses)/releases Operating profit - adjusted (6) Funded assets Net loans and advances to customers Customer deposits Risk-weighted assets Return on equity...

  • Page 191
    ... 3 Go-forward Bank profile 30 June 2015 TPAs £m 6.1 3.4 5.9 5.3 34.1 6.3 1.2 62.3 Asia-Pacific portfolio. European, the Middle East and Africa portfolio. CIB Capital Resolution by product APAC portfolio (1) Americas portfolio EMEA portfolio (2) Shipping Markets GTS Other Total Notes: (1) (2) RWAs...

  • Page 192

  • Page 193
    Appendix 4 Williams & Glyn RBS - Interim Results 2015

  • Page 194
    ... and capital profile of a standalone bank. Half year ended 30 June 30 June 2015 2014 £m £m Income statement Net interest income Non-interest income Total income Operating expenses (1) Profit before impairment losses Impairment releases/(losses) Operating profit (2) Analysis of income by business...

  • Page 195
    ... to customers Loan impairment provisions Net loans and advances to customers Total assets Funded assets Customer deposits - Retail - Corporate Total customer deposits Loan:deposit ratio (excluding repos) Risk-weighted assets (1) Note: (1) RWAs on an end-point CRR basis. 31 December 2014 £bn...

  • Page 196

  • Page 197
    Appendix 5 Parent company financial statements RBS - Interim Results 2015

  • Page 198
    ... 5 Parent company financial statements RBSG plc - Balance sheet at 30 June 2015 30 June 2015 £m Assets Loans and advances to banks Loans and advances to customers Debt securities Investments in Group undertakings Derivatives Prepayments, accrued income and other assets Total assets Liabilities...

  • Page 199
    ... Parent company financial statements RBSG plc - Statement of changes in equity for the period ended 30 June 2015 Half year ended 30 June 2015 £m Called-up share capital At beginning of period Ordinary shares issued At end of period Paid-in equity At beginning and end of period Share premium account...